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HomeMy WebLinkAboutM120208• 0k William S. Marlow Richard A. Broders Dave Garing William S. Marlow MINUTES December 2, 2008 1820 Jefferson Street P.O. Box 1220 Port Townsend, WA 98368 Richard A. Broders Dave Garing Chairman Vice - Chairman Member Chairman William S. Marlow called the meeting to order at 9:30 a.m. in the presence of Vice - Chairman Richard A. Broders and Member Dave Garing. PETITION WITHDRAWALS Member Gazing moved to accept the following petition withdrawals. Vice - Chairman Broders seconded the motion which carried by a unanimous vote. APPELLANT Larry & Elizabeth Lee Beckett Point Fishermen's Club KCH Enterprises, LLC Keith & Cynthia Hansen 970 Beckett Point Road Port Townsend, WA 98368 APPEAL NO. BOE 08- 144 -LO BOE 08- 145 -LO VITWEVRAMI&I BOE: 08 -47 -LO 08 -48 -LO PARCEL NO. 932 200 720 932 200 719 PN: 932 200 109 932 200 616 Keith and Cynthia Hansen were present. Appraiser Charley Hough represented the Assessor's office. After explaining the hearing process Chairman Marlow swore in both parties. Under appeal is the value of two bare land parcels located in Beckett Point. Following is the current assessment and the appellant's estimate of value for the parcels under appeal: Parcel No. Current Assessed Value Appellant's Estimate of Value 932 200 109 $62,500 (land only) $18,000 932 200 616 $90,000 (land only) $18,000 Phone (360)385 -9100 Fax (360)385 -9382 jeffbocc@co jefferson.Wa.us Board of Equalization Minutes - December 2, 2008 Page: 2 Mr. Hansen explained that they own four parcels in two different areas of Beckett Point. Two of the parcels (one with a structure built on it and one with no structure) are adjacent to each other and are located in the upper portion of Beckett Point known as Highway Heights. The other two parcels (one with a structure built on it and one with no structure) are adjacent to each other and are located on the waterfront portion of Beckett Point known as South Beach. They are only appealing the valuations of the two parcels with no structures built on them. One in the Highway Heights and the other in South Beach. In both cases the Assessor is valuing the two parcels as one "double lot" site even though the parcels have not been consolidated and could be sold separately. The method used by the Assessor is to value the second vacant lot at 50% of the value of the lot which has the structure. There are other vacant lots in Beckett Point that are valued significantly less than the 50% value just because they are a single lot and not a "double lot" site. The Assessor has made two assumptions about their property. The first is that their four parcels are only two sites. Mr. Hansen said they may want to sell the vacant lots at some point in the future. The second assumption is that their vacant lots can be developed. A number of property owners in Beckett Point have found it very difficult to get permits and it has yet to be determined whether or not permits will ever be issued due to setback issues, water availability and the latest issue with the archeological study. Mrs. Hansen stated that the term "developed" or "buildable" also includes expanding an existing structure over two lots. If required, an archeological study could cost tens of thousands of dollars. For example, Mr. Hansen described an area where a 2 x 2 meter hole was going to be dug to install a grinder pump. The archeologist's estimate was $20,000 to sift through the dirt to determine if it contains any materials of archeological significance. It is not a choice to pay for archeological services, but, a requirement. He noted that they are not only looking for human remains, but, anything which might be determined to be of archeological significance. Then if they find anything, you would be liable to pay all costs for further studies on whatever is found to determine their age, carbon dating, etc. It is called cultural resources, but, it is not clearly defined. He was unable to find any information within the Department of Archeology to give him a clear definition of what that is or what it would entail. There are state statutes, RCW's and WAC's that tie archeological studies to the cost of the project. For small homeowners it could end up costing more than the intended project. There is no way of knowing what a project in Beckett Point will cost. Mrs. Hansen added that their vacant lots do not have water, power or septic /sewer system, and there is no guarantee that there is the capacity for their lots to get those utilities. To install a sewer system will cost $30,000 without complications. It is highly unlikely that the Department of Community Development would even issue a permit to develop their lots. It would cost at least $50,000 just to get permission to build. In closing, Mr. Hansen stated there is no clear path to know what the costs will be or if the property owners will ever be able to develop those lots. Board of Equalization Minutes - December 2, 2008 Page: 3 Mr. Hough asked if the cost of any required studies would be paid by the individual property owner or the Beckett Point Fishermen's Club? Mr. Hansen replied that this is unprecedented so the answer is unknown at this time. He explained that the lot ownership in Beckett Point is very unique. The Beckett Point Fishermen's Club (a.k.a. Cape George Fishermen, Inc.) owns all the land in Beckett Point and leases the land to the individual property owners. As leaseholders, all the property owners in Beckett Point are members of the Club. The property owner could be construed as the Club itself. He stated that he would not support a neighbor's project if, as a member, he was going to have to pay for the archeological studies. Ms. Hansen stated that the Beckett Point Fishermen's Club would most likely deny an individual property owner's project if it were going to cost all members of the Club. Chairman Marlow asked if the Club has to approve all building projects? Mr. and Mrs. Hansen replied yes. It is similar to a homeowners association. Chairman Marlow asked if any project has been denied by the Club? Mr. Hansen replied no. Mrs. Hansen added that no project has been approved by the County either and they have been trying for six months. There are five (5) SPAADs (Site Plan Approval Advance Determination) in the process at this time and none have gotten to the point where it is known what the property owners will be able to do. Mr. Hough stated that in Beckett Point it is typical for two lots (double lot site) under the same ownership to sell together which is why they are valued using the methodology of discounting the second lot by 50 %. He presented seven (7) comparable property sales, all but two (comparable properties #6 & #7) are single lot sales. Exhibit 18, 18A and 18B shows how all the property in Beckett Point was valued. The method of valuation has not changed. He noted that up until this year, Beckett Point property owners received valuation change notices for only their improvements on the property, and all the valuation change notices for the land values of each parcel were sent directly to the Beckett Point Fishermen's Club as the owner. The Club would then divide the taxes equally among each member property owner for payment. However, recently the property owners had an Assessor's plat established for Beckett Point. Now the individual member property owners are also receiving the valuation change notice for the land along with improvements so they are aware that some properties are valued higher than others and yet each member is paying an equal share of the taxes on the land. Mr. Hough stated that Beckett Point at one time was a Native American fishing village. Human remains of Native Americans were found for the first time in the area of the County road. He doesn't think the upper land parcels will have problems with building and development like the parcels along the waterfront may have. He pointed out that Exhibit 20, 20A & 20B show which leaseholders currently have septic connections and which are authorized to connect to the system or are on a "wait list" for authorization. There are five parcels within the Highway Heights area that are owned by the Club and are currently receiving a 90% reduction in value for utility factors. He noted that in October 2008 lots 1 and 1 A within the Highway Heights area sold for $300,000. It is currently assessed at $282,000. Mr. Hansen commented on the property sale which occurred recently in October, stating that particular property is much bigger than their property and has a house that spans both lots. They have four smaller Board of Equalization Minutes - December 2, 2008 Page: 4 lots with a 400 square foot house that is located on one lot. Mrs. Hansen added that they are only appealing their vacant lots and it is not clear to them why their vacant lots are not valued similar to other vacant lots, and are instead being valued the same as lots with houses built on them. They would love to be able to build on their vacant lots, but, it is unknown if they will be able to. Mr. Hanson stated that it is true that the parcels located in the upper portion of Beckett Point may not have the same building problems as the waterfront parcels, however, their property is located in close proximity to the lagoon and may be subject to required setbacks from it even though their property is on the hill above it. Especially, if the new shoreline rules are adopted which require a 200 foot setback. He attempted to get information from the Department of Community Development about how the new rules might affect their property, but, was unable to without a geological report, which of course is another expenditure just to talk with the staff. Mr. Hough asked the appellants if they purchased the two lots together? Mr. Hansen replied that is correct. Mr. Hough stated that it is typical for two lots under the same ownership to sell together. Past sales indicate the market value of two lot sites (double lots) under the same ownership support the current assessed values regardless of the methodology used to value the lots. This is the methodology that has always been used for property in Beckett Point. The Bylaws of the Club state that the taxes for the land shall be divided equally among the members, even though the individual parcels are not assessed equally. Mr. Hansen stated that they are unable to arbitrarily change the membership agreement, but, it will be discussed at their annual meeting. Mrs. Hansen added that regardless of how the taxes are distributed among the members, this discrepancy in assessment affects the amount of the total tax bill. Mr. Hough stated that the appellant's house is located on one of the two waterfront parcels they own. They are only appealing the value of the adjacent vacant land parcel. They wanted to build a shed on this parcel, but, because it was so close to the water they had to apply for a permit. He asked the appellants if approval of the permit was granted? Mrs. Hansen stated that the permit was approved, but, only after going to a Commissioners' meeting to express their frustration with how long the process was taking, and much correspondence between them and the County Department of Community Development and the State Department of Archeology. Mr. Hansen stated that they finally received a shoreline exemption permit for a 12'x 6' shed. They had to assure the government agencies that there would be no excavation and the land would not be disturbed. The Director of Community Development even came to the property to inspect the footings being built. Mr. Hansen explained that there are vacant lots on both sides of their waterfront lots that are valued at $18,000 while their vacant waterfront lot is valued at $90,000 simply because they also own the adjacent parcel. They are separate parcels. The Club lists them as separate parcels and they have always been taxed separately. One is in his name and one is in his wife's name. They could even be sold separately. Board of Equalization Minutes - December 2, 2008 Page: 5 Mrs. Hansen stated that if they decided to sell their vacant waterfront lot, they would not be able to sell it for $90,000. She also doesn't think it adds $90,000 to the value of their adjacent parcel on which their house is built. Although, it certainly adds some value. Mr. Hansen stated that it is difficult to sell property or place a value on it when there is no way to determine the development costs. The assessment of $90,000 for a side yard is an awful expensive piece of turf. Especially, when there are similar vacant lots that are only assessed at $18,000. Mrs. Hansen made the point that if their vacant lot were in her mothers name it would it be valued at $18,000. They would never transfer ownership to get a lower assessment because it is illegal and unethical. It just doesn't seem equitable to base assessments on ownership. Mr. Hansen asked if a vacant lot was purchased by the adjoining lot owner for $18,000, would the assessment automatically increase to $90,000 or would the assessment remain at $18,000? Mr. Hough explained that sales show that the combined value of two lots (double lot) under the same ownership is worth the assessed value. Hearing no further testimony, Chairman Marlow closed the hearing. The Board will make a determination at a later date. Beckett Point Fishermen's Club BOE: 08 -102 -R PN: 932 200 730 Vernon E. Barnett & Emily D. Holmes 08- 103 -LO 932 200 729 P.O. Box 1964 Port Townsend, WA 98368 Vernon Barnett and Emily Holmes were present. Appraiser Charley Hough represented the Assessor's office. After explaining the hearing process Chairman Marlow swore in both parties. Under appeal is the value of two adjacent parcels (one bare land and one improved) located in Beckett Point. Following is the current assessment and the appellant's estimate of value for the parcels under appeal: Parcel No. Current Assessed Value Appellant's Estimate of Value 932 200 730 $289,780 ($190,000 land/$99,780 imps) $124,780 ($75,000 land/$49,780 imps) 932 200 729 $90,000 (land only) $50,000 Ms. Holmes stated that their property is not assessed similar to neighboring properties in the area. They obtained a demolition permit to have an addition removed from their house in August. Now their house is smaller, yet it is valued higher. The house on the neighbor's property (lot 31) is almost identical to their house, but, is valued $40,000 less. With regard to their vacant lot she stated that they recently applied for a SPAAD (Site Plan Approval Advance Determination) which was denied. They don't feel it is fair to assess the property as though it could be developed, when in fact, it cannot. Board of Equalization Minutes - December 2, 2008 Page: 6 Mr. Hough explained that the property was assessed as of January 1, 2008 and the addition on the house had not yet been removed at that time. The removal of the addition will be recorded in the Assessor's records in 2009 when they conduct their inspections for new construction. The appellants are currently on a waiting list to have their vacant lot connected to the sewer system. This property is subject to potential archeological studies as a result of the human remains of Native Americans that were found in another area at Becket Point. It is unknown if the appellants will ever be issued a building permit to develop the property. The basis for the assessment of this lot was not whether or not it can be developed. The assessment was based on comparable property sales. Past sales show that two -lot sites (double lot) under the same ownership always sell together. The appellants purchased the lots together. The combined value of the two lots is supported by market sales. Mr. Barnett stated that ever since the human remains of Native Americans were found, building projects on property at Beckett Point have been subject to much scrutiny. It is unknown if they will ever be able to build on their vacant lot. He questioned why their vacant lot is valued at $90,000 and other identical vacant lots are valued at $18,000? Mr. Hough explained that it has a higher value because it is the second lot of a two lot site. It has a base value of $180,000 with a 50% reduction for being the second lot. It adds that much value when combined with the improved lot and even though the two lots can be sold separately, property owners in Beckett Point typically sell two -lot sites together. The single vacant lots which are assessed at $18,000 are receiving a reduction of 90% off the base land value because it is unknown whether or not they can be developed. Mr. Barnett stated that they don't know if they can develop their property either. Mr. Hough realizes that, but, the fact that the appellants also own the improved lot adjacent to the vacant lot, increases the value of the vacant lot. Other two -lot sites in Beckett Point are valued the same way. Mr. Barnett asked whether or not the similarly valued two -lot sites are improved or vacant, and if improved, whether or not the structures are built on one of the lots or spans /encroaches on both lots? Mr Hough replied that the structures span both lots. Ms. Holmes asked why their neighbor's property is assessed $40,000 less when they have a larger house and garage? Mr. Hough stated that the effective age factor for depreciation is higher for the neighbor's property. The Assessor's records show the appellant's property was remodeled in 1981 which gives them a lower depreciation factor. Ms. Holmes explained that the remodel in 1981 was the addition to the house that they just recently had removed. Their house was built a year earlier than their neighbor's house. They were both built by the same person and are nearly identical. Mr. Hough reviewed the exhibits presented in support of the assessed value. Hearing no further testimony, Chairman Marlow closed the hearing. The Board will make a determination at a later date. Board of Equalization Minutes - December 2, 2008 Page: 7 Beckett Point Fishermen's Club Edward & Rosemarie Edwards 2410-35 Ih Street Port Townsend, WA 98368 Beckett Point Fishermen's Club William & Patricia Sahlinger 890 Beckett Point Road Port Townsend, WA 98368 Beckett Point Fishermen's Club Clyde & Colleen McQueen 1562 E. Garfield Street Seattle, WA 98112 Beckett Point Fishermen's Club John & Michelle Brooks 1811 - 38`h Avenue E. Seattle, WA 98112 BOE: 08 -146 -R BOE: 08 -147 -R 08 -148 -R BOE: 08 -149 -R BOE: 08 -150 -R PN: 932 200 726 PN: 932 200 604 932 200 401 PN: 932 200 722 PN: 932 200 721 The following appellants were present: Edward and Rosemarie Edwards, William and Patricia Sahlinger and Michelle Brooks. Clyde & Colleen McQueen were not present. Appraiser Charley Hough represented the Assessor's office. After explaining the hearing process Chairman Marlow swore in all parties. Under appeal are the land and improvement values of property located in Beckett Point. Following are the current assessments and each appellant's estimate of value for the parcels under appeal: Parcel No. 932 200 726 932 200 604 932 200 401 932 200 722 932 200 721 Current Assessed Value $368,065 ($280,000 land/$88,065 imps) $398,520 ($280,000 land/$118,520 imps.) $420,240 ($280,000 land/$140,240 imps.) $536,890 ($280,000 land/$256,890 imps.) $296,910 ($190,000 land/$106,910 imps.) Appellant's Estimate of Value $300,000 ($240,000 land /$60,000 imps) $265,000 ($180,0001and /$85,000 imps.) $280,000 ($220,000 land/$60,000 imps.) $310,000 ($160,0001and/$150,000 imps.) $150,000 ($80,0001and/$70,000 imps.) Mr. Edwards explained that he is a lease holder of property at Beckett Point and also serves as a member of the Beckett Point Fishermen's Club Board of Trustees. There are three issues he would like to discuss. The first deals with differing tax information between the club and the Assessor's office. The club members are all the property owners in Becket Point. All the club members lease their land from the club and make the decisions with regard to the club. Every decision is made by all the members to insure fair charges as well as insuring the integrity of the process. He explained that since the late 1930's all the land taxes were distributed and paid equally by each member /leaseholder. The club is a non -profit corporation and has the right to determine how the taxes are assigned within the corporation, because the corporation Board of Equalization Minutes - December 2, 2008 Page: 8 owns all the land and leases it to all the members. The problem is with the fact that the Assessor's office publishes the value of each individual parcel which may vary. Therefore, if someone looks in the Assessor's records for the amount of taxes on a Beckett Point parcel, they will see a different amount from what the club actually charges. They believe this needs to be resolved and would like to have the County not publish figures which are contrary to the club's figures, but, still allow the County to pass along the figures which the Assessor staff believe are the values from their viewpoint. To fix the problem internally, the club will review the Assessor's valuations at their next annual meeting and hold a vote on how the taxable value will be distributed. The second issue deals with requirements of the State Department of Archeology as a result of the human remains of Native Americans that were found at Beckett Point. The State is requiring the club to conduct surveying of the area, however, their website offers no ability to define a survey so the club is beginning to work with the State on determining that process. He noted that any archeological studies will be the financial responsibility of the club. Those costs are unknown, but, could be astronomical based on a similar case when human remains of Native Americans were found in Port Angeles. He does not know how to solve this problem easily. On behalf of the Beckett Point Fishermen's Club they would like the Board to encourage the Assessor to request the State Department of Revenue work with the State Department of Archeology to determine how this issue is affecting the value of their property. There is statutory authority under RCW 84.41.060 to do that, and they need the help. Separately, within the Department of Revenue, there is a rule or clause inside their structure which allows them the legal position to work with other agencies to determine the impact of certain influences on property valuations. The third issue has to do with SPAADs (Site Plan Approval Advance Determination) which are affected by the SMP (Shoreline Master Plan). The club has been advised very strongly by the Jefferson County Department of Community Development that anyone wanting to build on property which is not currently developed, or wanting to do a major remodel (over 50% of value changes), had better apply for a SPAAD. If the SPAAD is approved the property owner has five years to proceed with their development plans. When the new SMP is adopted which has stricter regulations and greater required building setbacks from shorelines, many properties will no longer qualify for a SPAAD and subsequently will not be buildable. He requested the Board also ask the State Department of Revenue to contact the State Department of Ecology to determine how to resolve these problems and find out how they affect the values of property at Beckett Point. He stated that he personally has no problems with the Assessor's valuation process for his property. He is not here to argue about that as it is relatively meaningless compared to the big problems for Beckett Point. Patricia Sahlinger stated that she is here today to speak on behalf of her property, as well as to explain what the Beckett Point Community is about. She owns a total of four lots at Beckett Point. Two lots adjacent to one another are located in the North Beach area and the other two lots are adjacent to each other in the South Beach area. She does not understand why the value of her neighbor's land is valued $100,000 less than her land. Board of Equalization Minutes - December 2, 2008 Page: 9 Mrs. Sahlinger stated there are 100 homes in the Beckett Point community. Most of the homes are older and have been passed down over the years from family members. Some of the homes are referred to as "fishing shacks" and in fact were brought in for that purpose. There has been a moratorium for the last 10 years on any development except for certain repairs. Only 10 people live at Beckett Point on a full time basis. This is due to several things such as inadequate homes and being subjected to severe weather conditions 4 to 5 months out of the year. Property has been flooded a number of times and bulkheads have been lost. Property owner's bulkheads are in desperate need of repair to protect their homes, but, they are restricted from making those repairs due to County regulations. All the property owners in Beckett Point agreed that a septic system was needed for the community and agreed to pay for it personally. After looking into the matter it was found that the septic system was going to cost $2,700,000. Divided equally, that is a cost of $27,000 to each homeowner and most are only part -time residents. The community worked hard with the County agencies to get the project done. Payment of the system comes due in March 2009 and all development has been shut down. She is also concerned about the assessment of the land at Beckett Point which has almost doubled. After the huge payment in March, property owners are going to have to pay a huge tax bill in April 2009. She is worried that property owners will be forced to sell. She noted that as a condition of installing the septic system, the property owners were required to have their lot surveys converted to an "Assessor's Plat ". Creation of the Assessor's Plat cost the community $14,000. Chairman Marlow asked for an explanation of the Assessor's Plat? Mr. Edwards explained that when properties in Jefferson County were originally mapped, Beckett Point was mapped as having 1 house for every 20 acres, instead of mapping the properties as they actually exist. That set up a problem with the properties being non - compliant. By being non - compliant there was no way to argue how to properly apply any rules and regulations to the Beckett Point development. The installation of the septic system solved the problem of sewage going into bay, but, as part of the septic system installation process the County required the creation of an Assessor's Plat in order to make the lots legal in terms of density. Mrs. Brooks added that the club reviewed doing an Assessor's Plat prior to the completion of the septic system installation process, and one of the points that was raised is that once the plat was created, the properties would be assessed individually. All the property owners in Beckett Point are members of the Beckett Point Fishermen's Club. From the member's perspective, the idea of individual assessments seemed somewhat risky, in the sense that the members did not want to erode the validity of their club structure that has worked quite well from a community standpoint as well as from a citizens point of view. They didn't want to risk the members feeling individualistic and less tied to each other and to the club, so they decided against doing an Assessor's Plat. But then the County made it a condition of getting the septic system approved. As a community they agreed that the installation of the septic system was the right thing to do, and even though they were worried about the implication individual assessments would have on their club structure, they decided to work closely with the County and trust that it would not work against them in the future. Board of Equalization Minutes - December 2, 2008 Page: 10 Mr. Edwards stated that they take the position on government that it is a direct democracy. Within the structure of America, a direct democracy is a better democracy than a represented democracy. The club members consider themselves fairly straightforward and advanced in the way they manage their affairs. Chairman Marlow stated he now understands why the plat was created, but, he doesn't understand what it means for the club? Mr. Edwards replied that sending individual assessments to the property owners causes division among the members of the club. He understands that with the creation of the Assessor's Plat the Assessor's office is statutorily required to send the individual valuation notices to each property owner, but it sets up an atmosphere of conflict where one property is better than the other. Mrs. Brooks added that it breaks apart the sense of community that exists at Beckett Point. She is not aware of any member that wants to move to a "fee simple" arrangement. There are some concerns that this is the first step that will take them down that road. The notification of the individual land values to the individual leaseholders is viewed as inappropriate to their structure, potentially an overstep by the County, and an insertion of a valid set of government entities into a private corporation. An analogy that has been discussed is that as leaseholders they are essentially equivalent to renters in an apartment building. If she were a leaseholder in an apartment building and got a valuation for her unit, it would appear as if the building were a condominium. If the community has an interest in supporting or enforcing this type of conversion then there needs to be discussion about it. However, if that is not the intention, then they need to be very careful to not inadvertently go in that direction. Whether by foresight or happenstance, the individuals who established the Beckett Point Fishermen's Club truly codified the community stated Mrs. Brooks. The members act in ways that are different because they are leaseholders and members of the corporation as opposed to simply being an owner. As an individual owner she would not feel the sense of obligation, responsibility and accountability to their small community and to the larger ecological surroundings that they are a part of on the bay. As an individual owner she would have been hard pressed to come up with $30,000 of her own money for a septic system. She would have waited for her system to fail and then figured something out. But, being part of the club gives them a mechanism that actually forces marginal decisions that say we have a collective responsibility for the land, to and for each other, and for the water that surrounds it. It makes them make different decisions. Decisions which are very powerful and very important. This equality is fundamental to the community itself. Mrs. Brooks continued by stating that the structure of the corporation depresses the value of the land and homes at Beckett Point. Beckett Point is not considered investment property. There is no guarantee for development or remodeling. Beckett Point is however, a great place to join a community. They can provide to their kids a place they feel part of, take care of and have some stewardship of. She explained that the members self - select who buys in and becomes leaseholders. This is lost to the degree that the structure is eroded. People who are looking for short term investments do not last at Beckett Point. Mrs. Sahlinger explained that Beckett Point Fishermen's Club owns the land and has to collect the taxes due from each leaseholder which is the way it has always been done. The problem now is with the fact that the Assessor's office is notifying all the leaseholders of their individual land assessments that use to Board of Equalization Minutes - December 2, 2008 Page: 11 go directly to the club as owner. Now the individual leaseholders are aware of the differing land values. Her neighbors land is valued at $18,000 while her land is valued at $140,000. This cause a dissension among the leaseholders who are paying equal taxes, but, do not have equal valuations. There are 12 different values among the 156 lots. This is going to be a problem for their community. Mr. Edwards reported that the total land value for all the property at Beckett Point is assessed at $20,500,000. Which is an increase from $12,000,000 assessed four years ago. Mrs. Brooks asked if the Assessor's Plat can be rescinded? It is her understanding that with it in existence, it is a non - negotiable process that assessment notices are sent to the individual leaseholders, and that the individual values would be the published assessments. Another question she has is how the property increased in value from $12,000,000 to $20,000,000 over the last four years? She also asked if there is a benchmark or a check to make sure the Beckett Point property values are equitable with other communities in the County in terms of relativity and proportionality of taxes and valuation increases? She also would like to know how assessments directly correlate to the sale values. Mrs. Brooks added that Beckett Point residents are already pressed with the $30,000 septic system fee. Many residents are retired and in the current economic climate she is concerned that they will be priced out of their homes. Chairman Marlow explained that the Board is sympathetic, however, "hardship" is not an issue which can be considered by the Board. After being sworn in, Assessor Jack Westerman explained that the Senior Citizen Exemption program or the Tax Deferral program is available to qualifying residents of Beckett Point even though they are leaseholders. He stated that the land assessment would have been the same amount whether it was sent as individual values or a total value. The Assessor's staff has always valued the lots individually and those values were always sent directly to the club. The individual members at any time could have looked at the spreadsheet to see their individual land valuations. The only change that was made is that the individual land assessments are now being sent directly to the individual leaseholders, so they are now aware of the differing assessments. As far as whether or not it is legal to vacate the plat, the members will need to consult with an attorney and go to court, similar to any other plat vacation process. Whether or not it is possible would be decided by a Judge. Mr. Westerman responded to the question about the significant increase in value stating that the approximate 60% increase was typical for most land values in the revaluation area. Some properties in Cape George doubled in value with assessments increasing 100 %. In some cases, property tripled in value. The overall valuation increase from $12,000,000 to $20,000,000 for Beckett Point properties equitably fits in the range of property value increases in other areas of the County. He stated that the Assessor's staff did not use sales from other areas of the County to value Beckett Point properties. They looked at the market value of Beckett Point properties and based the assessments on sales which occurred within Beckett Point during the revaluation period. County property values are not automatically increased by a certain percentage rate every four years. Valuation increases are based on sales of similar property. In this case, Beckett Point properties did not increase as much as property in other areas of the County. As far as ratios, Mr. Westerman reported that property values in Jefferson County are typically at Board of Equalization Minutes - December 2, 2008 Page: 12 90% of market sales, based on ratio studies conducted each year by the State Department of Revenue. Chairman Marlow asked if that holds true for Beckett Point properties? Mr. Westerman replied yes. He explained that since the Assessor's rolls closed there have only been two sales. In fact, they received the documentation on one of the sales today. It is located in the North Beach area of Beckett Point. It is currently assessed at $208,000 and it just sold for $230,000. That shows the assessment is at 90% of the sale price. Mrs. Brooks stated that rather than looking at this in the context of being a hardship, it should be viewed by what the community did for the environment. By privately funding the septic system in order to protect and preserve the bay, the community was termed a "model" by Senator Norm Dicks and Representative Lynn Kessler. The assessment is punitive to the community, and while that may not be the intention, it is the absolute result. This sends the wrong message to all other communities that are looking at making the same decision Beckett Point has faced. Mr. Edwards stated there is a dilemma with the fact that the Assessor's records show an amount for taxes which is different from the amount actually charged by the club. Mr. Westerman stated the club will have to determine how that will be handled. When properties are listed for sale the club will have to inform Realtors that the taxes are distributed equally by the members. Chairman Marlow stated that he understands the dilemma, but, it is not an issue that can be decided by the Board of Equalization. Mr. Westerman added that he agrees that the Beckett Point community has done a remarkable thing for the environment by installing a community septic system. However, the cold hard reality of property tax law in the State of Washington is that the Assessor is required to value property at 100% of its fair market value as of the assessment date, regardless of what a great job they did from an environmental standpoint. Mrs. Brooks asked if the Assessor's office is statutorily required to mail valuation notices to the leaseholders? Mr. Westerman stated that they are required to mail the valuation notices to the title owner. Valuation notices are sent to the owner because the owner has the opportunity to appeal the value. From a legal standpoint, if they are asking that the valuation notices only be sent to the club and that they not be sent to the leaseholders, he would have to check with the Prosecuting Attorney. The valuation notices are sent as a convenience so the property owner will have as much information as possible for their right to appeal. Mrs. Sahlinger stated that in the past the notices to the leaseholders only included the improvement value and not the land value. The land value notices went directly to the club. Mr. Westerman agreed and stated the improvement values could have been sent directly to the club, but, his office was requested to send notices to the individual leaseholders and did so as a courtesy. Mr. Hough explained that the valuations were based on the sales that occurred within Beckett Point over the last four years. He realizes that there are many questions about whether or not they can build on the vacant lots, which is why the lots which are not connected to the septic system or on a waiting list to be connected, are reduced in value by 90 %. Some parcels are receiving valuation reductions of 75% and Board of Equalization Minutes - December 2, 2008 Page: 13 50 %. These are the same adjustments which have been used in the past as well. Nothing has changed in the valuation methodology. The only change that was made is that the valuation notices are now being sent to the individual leaseholders and they are now aware of the difference in valuations among the properties. Mr. Westerman added that he is not certain that the land values currently reflect that the lots might be buildable now that there is a community septic system and water system. It will probably be a few years before the market reflects that, and when it does, assuming the archeological problems have been delineated, the Assessor's office may have to change or remove the adjustments and reductions in value for some of the lots. But, at this point in time the Assessor's office made the decision that until property owners go through that process, the valuation adjustments will remain the same. Mrs. Brooks asked if there is any assumption of buildability included in the valuations at all? Mr. Westerman replied no. The valuation is strictly based on the properties which sold. Discussion ensued regarding the valuation of the open space property at Beckett Point and questions posed from the Board members were answered. Hearing no further testimony, Chairman Marlow closed the hearing, The Board will make a determination at a later date. Vice - Chairman Broders moved to adjourn the meeting until 9:30 a.m. Wednesday, December 3, 2008. Member Garing seconded the motion which carried by a unanimous vote. ATTEST: ti Erin Lundgren, lerk f the oa!W- JEFFERSON COUNTY BOARD OF EQUALIZATION William S. Marlow, ChArman Richard A. Broders, Vice - Chairman Dave Garingem